Casa Grande council to decide data center waiver tied to owners’ $140M claim
The Casa Grande City Council is scheduled to consider a property-specific Proposition 207 waiver Monday, August 3, that could resolve a compensation claim tied to a proposed data center campus near North Bianco Road and West Clayton Road.
Resolution 5960 is listed for the council’s 7 p.m. regular meeting at City Hall, 510 E. Florence Blvd. The proposed binding waiver would apply to approximately 480 acres near the southwest corner of North Bianco Road and West Clayton Road. It would waive the city’s conditional-use-permit requirement for the subject property while imposing operating restrictions if a data center project advances.
Why the waiver is before the council
City staff says attorneys for two property owners filed a Proposition 207 request for just compensation in February 2026 after the city changed its zoning rules in 2025. The owners allege that moving data centers from a permitted use to a use requiring a conditional-use permit reduced the property’s fair-market value by more than $140 million combined.
That amount is the property owners’ claim as described in city staff materials, not a final appraisal, court finding or established city liability. Arizona’s Private Property Rights Protection Act allows a property owner to seek compensation when a land-use regulation allegedly limits previously allowed property rights and reduces fair-market value.
The staff report identifies four possible responses: repeal the zoning change, authorize compensation, deny the claim and potentially litigate, or waive enforcement of the challenged rule on the specific property. Staff recommends the property-specific waiver as a negotiated resolution that could avoid the uncertainty and expense of litigation while preserving the city’s broader conditional-use-permit rules for future data center proposals.
Proposed limits on water, power and noise
If approved, the waiver would establish binding requirements for the proposed campus, but it would not itself authorize construction.
The most specific limit is an annual cap of 800 acre-feet of potable water for data center and on-site power uses. Before a building permit could be issued for a data center structure, the owner would have to disclose the proposed cooling technology and estimated water demand. The proposed terms also would require annual water-use reporting and prohibit once-through cooling systems.
Any on-site power generation would require advance disclosure of the technology, capacity and primary fuel source. The owner would also have to identify applicable federal and state environmental permits. On-site power facilities would remain subject to city zoning and permitting requirements and applicable standards enforced by agencies including the Arizona Department of Environmental Quality, the U.S. Environmental Protection Agency and, where applicable, the Federal Energy Regulatory Commission and Arizona Corporation Commission.
The proposed noise rules would require a study by a licensed acoustical engineer before building permits are issued. The campus would be designed so noise from the data center, on-site power generation and electrical infrastructure does not exceed 60 decibels from 8 a.m. to 9 p.m. or 55 decibels from 9 p.m. to 8 a.m. A post-construction noise assessment would be required within 90 days after each phase becomes operational.
If a data center stopped operating for 24 consecutive months, or the owner notified the city that the facility would permanently close, decommissioning would have to begin within 180 days. The proposed requirement would cover technology and cooling equipment, backup generators, fuel tanks, batteries, transformers and substations.
Possible recreation contribution
The proposed terms include a voluntary $5 million contribution to city recreation facilities if the property is developed for data center use. The staff report says the payment would be divided into two $2.5 million installments tied to certificates of occupancy for the project’s first two phases.
City staff also describes the potential fiscal alternatives if the claim is not resolved through a waiver. A compensation award exceeding $140 million could require a combination of fund balances, budget reallocations, delayed or reduced capital projects, debt and future operating cuts. Denying the waiver could instead lead to litigation, with legal, staff and expert-witness costs and no predictable outcome.
Approval would not authorize construction
No end user has been publicly identified. City materials describe a possible campus of up to 13 buildings totaling approximately 3.25 million square feet, but those figures describe a proposed development concept rather than an approved construction plan.
If the council approves Resolution 5960, the developer would still need to submit detailed site plans and complete city reviews involving compatibility, traffic, access, parking, utilities and required improvements. Public notification and additional building, fire, engineering, environmental, utility and other local, state and federal approvals also would remain necessary before development could proceed.
The council’s action Monday will therefore decide whether to approve a property-specific legal and zoning framework for the proposed campus. It will not create a citywide exemption from conditional-use permitting, identify a tenant or allow construction to begin.
Residents should watch for the council’s vote and any later site-plan filings, public notifications, utility reviews and permit applications tied to the property.
Sources
- Casa Grande City Council staff report for Resolution 5960
- City of Casa Grande Proposition 207 waiver FAQ
- Pinal Post report on the waiver
Discover more from Interactive News
Subscribe to get the latest posts sent to your email.
